Login/Logout

*
*  

"In my home there are few publications that we actually get hard copies of, but [Arms Control Today] is one and it's the only one my husband and I fight over who gets to read it first."

– Suzanne DiMaggio
Senior Fellow, Carnegie Endowment for International Peace
April 15, 2019
Gates Outlines Export Control Overhaul

Jeff Abramson

The Obama administration is shifting U.S. policy on export controls by focusing its efforts on “crown jewel” technology and items, Secretary of Defense Robert Gates said last month.

The plan, announced April 20 in a speech to a Business Executives for National Security meeting in Washington, would align procedures across multiple bureaucracies in the near term without new legislation. It also calls for working with Congress to adopt new laws that would make a single agency responsible for export licenses, possibly by the end of this year. Many key elements have yet to be detailed, including which specific weapons and dual-use goods might be moved to new tiers or removed entirely from control lists. Dual-use goods are items, technology, and information that have both military and civilian uses.

Gates said that President Barack Obama hopes to work with Congress “to turn these proposals into legislation that the president can sign sometime this year.” That plan, however, has not garnered significant congressional support.

After the April 20 speech, Rep. Howard Berman (D-Calif.), chairman of the House Foreign Affairs Committee, said Gates had “delivered a forceful rationale” for revising U.S. export control systems. Berman has been working on a new Export Administration Act (EAA), which regulates dual-use items. He said that he has been “closely consulting” with the administration and expects to introduce legislation “shortly.”

He was more noncommittal on the broader overhaul. He noted that Gates had “set forth his own vision of how the…export control systems might be fully merged. Should the president propose such a step later this year, I will carefully consider it.” A congressional source said in an April 22 interview that, for now, legislators considered the administration proposals as only a “study.”

In a statement, House Armed Services Committee Chairman Ike Skelton (D-Mo.) said, “I am confident that we can work closely with Secretary Gates on a bipartisan basis and with other committees in the Congress to make sure that the system protecting our technology is as excellent as the technology itself.” Rep. Howard McKeon (R-Calif.), the panel’s ranking member, welcomed the chance to “carefully study” the proposal and stressed “national security as the paramount factor in the export control system.”

On Jan. 27, Gates and other administration officials briefed congressional leaders on the ongoing review. According to congressional sources, there was some resistance at that time to aspects of the review and some of its assumptions. In the April 20 speech, Gates said, “I valued the feedback and the suggestions they provided at the time, and look forward to further dialogue.”

Opponents of export control overhaul cite concerns about national security and the danger of weapons and technology ending up in the hands of enemies of the United States and its allies. In the speech and in responses to questions, Gates admitted that previous export control reform efforts had failed, noting that the Department of Defense at times contributed to those failures. The Pentagon “has not overflowed in the past with enthusiasts for this kind of change,” he said.

The new element this time, he argued, is broad interagency support for the reform effort. He specifically identified Secretary of State Hillary Rodham Clinton, Secretary of Commerce Gary Locke, and Undersecretary of State for Arms Control and International Security Ellen O. Tauscher as backing the effort.

In his speech, Gates criticized the current system for trying to control too much and argued that requiring licenses on spare parts for certain military equipment already exported, such as F-16 fighter jets, hampers cooperation with allies. He said that defense trade cooperation treaties with the United Kingdom and Australia, which remain in the Senate awaiting its advice and consent, would be a “step in the right direction,” but that fundamental reform was needed. (See ACT, January/February 2010.) “Frederick the Great’s famous maxim that he who defends everything, defends nothing certainly applies to export control,” Gates stated.

Gates emphasized that the administration, rather than Congress, needed to act first. “[M]y hope is that as we streamline the process that the executive branch is responsible for, that there will be those in the Congress who can then lead some efforts to streamline the effort up there,” he said.

Higher Walls and Consolidated Processes

The guiding concept behind the administration’s export control reform approach is often described as “higher fences around fewer items.” Obama previewed that theme in a March 11 speech at the Export-Import Bank’s annual meeting when he said, “What we want to do is concentrate our efforts on enforcing controls on the export of our most critical technologies, making America safer while enhancing the competitiveness of key American industries.”

In the April 20 speech, Gates added a bit more detail, identifying items and technologies “relating to global terrorism, the proliferation and delivery of systems of weapons of mass destruction, and advanced conventional weapons” as being of primary concern. Goods that “have no significant military impact or that use widely available technology could be approved for export more quickly,” he said.

Currently, the departments of Commerce, Defense, and State all play major roles in approving and monitoring U.S. exports of defense items and dual-use goods. Under the Arms Export Control Act, the Defense and State departments oversee the transfer of defense articles and services listed on the U.S. Munitions List. Under the EAA, the Commerce Department oversees the Commerce Control List covering dual-use goods. (See ACT, January/February 2008.) Gates specifically called this “bureaucratic apparatus” a “major obstacle” and one that “results in confusion about jurisdiction and approval.”

The administration plan aims to consolidate the export control system via four “singles.” They are a single control list, a single licensing agency, a single enforcement agency, and a single information technology (IT) system.

In the first two phases of the three-phase plan, the administration would refine existing control lists and create a new tiered system that would allow for an item or technology to “be cascaded from a higher to a lower level of control as its sensitivity decreases,” according to Gates. During this period, congressional notification would be required to remove items from the munitions lists or transfer them to the dual-use list, according to a White House fact sheet released the same day as Gates’ speech. In the final phase, which would require new legislation from Congress, the two lists would be merged.

According to the fact sheet, licensing would similarly be streamlined to harmonize procedures among existing agencies at first, in order to “achieve significant license requirement reduction.” Whether the eventual single licensing agency would be housed in an existing agency or within an entirely new one is still under consideration, according to one of the senior Pentagon officials who conducted a background briefing April 19. Gates said he expects a presidential decision this spring on the agency’s location.

The administration also has not determined where it would locate the consolidated enforcement agency, but the officials said that it is currently being considered as separate from the licensing agency. They stressed the coordinating role of the enforcement agency, explaining that “even once reform is accomplished… there will still be multiple players involved in enforcement.” One of the officials cited “ICE [Immigration and Customs Enforcement], State [Department] enforcement, Commerce Export Enforcement Office, FBI, and many others” as part of the enforcement system.

The proposed single IT system would encompass licensing as well as enforcement information. Like the other steps, an enterprise-wide IT system would be fully implemented only in the final phase of the plan.

Tackling IT issues has been an ongoing effort. The Bush administration called for reforms of underlying technology so that all agencies could review the same data. (See ACT, March 2008.)

A senior Defense Department official indicated at the April 19 briefing that the Pentagon’s IT system is “likely to be the backbone of where we go forward.”

Plan Support and Antecedents

Aspects of the plan, including an emphasis on administration-based action, can be traced to a 2009 National Academy of Sciences study, which found that “the current system of export controls now harms our national and homeland security, as well as our ability to compete economically.” Until December 2006, when he became defense secretary, Gates co-chaired the committee associated with the study.

Industry groups, including the National Association of Manufacturers (NAM) and the Aerospace Industry Association, expressed general support for the new approach, which echoes arguments they have made for years in favor of loosening control on widely available technologies and streamlining licensing processes. In an April 20 statement, NAM Vice President for International Economic Affairs Frank Vargo said, “Manufacturers are pleased the Administration is moving forward with changes to modernize the current Cold-war era system.”

The Obama administration announced the start of its export control review in August 2009. (See ACT, September 2009.) At the April 19 briefing, a senior Pentagon official said that the National Intelligence Council assessed the U.S. export control system and came to “the frank and unfortunate conclusion” that “the system itself poses a potential threat to national security.” Gates simply noted the need for urgent action “given the harmful effects of continuing with the existing set of outdated processes, institutions, and assumptions.”